USAir chairman links growth to acquisition or partnership Wolf makes remarks at employee meetings

Airlines

April 16, 1996|By NEW YORK TIMES NEWS SERVICE

USAir's future lies in buying another airline, being acquired itself, or forming some partnership with another carrier, Stephen M. Wolf, the airline's new chairman, has told employees in the last few weeks.

According to people at employee meetings where Mr. Wolf shared his analysis of USAir's strengths and weaknesses, he said he would prefer to see USAir grow internally, but that would be difficult to achieve in the current industry environment.

He added that USAir must continue to reduce costs, become more productive and "must become the carrier of choice as opposed to a carrier of convenience," according to several people who heard Mr. Wolf's presentation. They declined to be quoted by name.

Between many cities on the East Coast, USAir is either the dominant carrier or the only one.

Mr. Wolf underscored that none of these goals could be pursued in isolation for USAir. The nation's sixth-largest carrier has struggled financially for years, largely because of high costs.

Mr. Wolf is a former chairman of United Airlines. He described USAir as an airline that is neither a mega-carrier nor a low-cost carrier, but one that is roughly similar in size to Trans World Airlines and Continental Airlines. Those companies have each emerged twice from bankruptcy protection and lowered their costs.

Mr. Wolf also said that efforts to merge the operations of airlines that USAir acquired in the late 1980s -- Piedmont and PSA -- were unfinished, implying that many members of USAir's labor force still identify more with their old carrier than with USAir.

Mr. Wolf and USAir's president, Rakesh Gangwal, have made presentations in recent weeks to groups representing USAir's three largest unions, its senior managers and to four groups of employees, with hundreds in attendance.

USAir officials declined to comment yesterday.

According to people who have heard his presentation, Mr. Wolf said USAir had too many different aircraft with fewer than 150 seats and too few large aircraft.

Pub Date: 4/16/96

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